[  ]

Preliminary Proxy Statement

[  ]

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

[X]	Definitive Proxy Statement

[  ]

Definitive Additional Materials

[  ]	Soliciting Material Pursuant to §240.14a-12

[X]	No fee required.

[  ]	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(3)

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4)

Proposed maximum aggregate value of transaction:

[  ]	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously.  Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

 

 

 

 

 

 

 

 

                                                                                                    

 

 

 

 

 

 

 

 

 

 

 

 

(3)	To hold a non-binding advisory vote on the frequency of future executive compensation advisory votes (every one, two or three years);

 

(4)	To ratify the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm for fiscal year 2012; and

 

 

 

                     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

•

Vote by Telephone. You can vote your shares by telephone by calling the toll-free number listed on the enclosed proxy card on a touch-tone telephone 24 hours a day through 12:00 PM Central Time on May 23, 2011. Easy-to-follow voice prompts enable you to vote your shares and confirm that your instructions have been properly recorded. If you are a beneficial owner, or you hold your shares in “street name,” please check your voting instruction card or contact your bank, broker or nominee to determine whether you will be able to vote by telephone.

 

•

Vote by Internet. You can also vote via the Internet through 12:00 PM Central Time on May 23, 2011 by following the instructions on the enclosed proxy card. The website address for Internet voting is indicated on the enclosed proxy card. Internet voting is available 24 hours a day. If you are a beneficial owner, or you hold your shares in “street name,” please check your voting instruction card or contact your bank, broker or nominee to determine whether you will be able to vote by Internet.

 

•

Vote by Mail. If you choose to vote by mail, complete, sign, date and return your proxy card in the postage-paid envelope provided. Please promptly mail your proxy card to ensure that it is received prior to the Annual Meeting.

 

 

 

 

Under Delaware law and the Company’s by-laws, directors are elected by the affirmative vote, in person or by proxy, of a plurality of the shares entitled to vote in the election at a meeting at which a quorum is present.  Only votes actually cast will be counted for the purpose of determining whether a particular nominee received more votes than the persons, if any, nominated for the same seat on the Board of Directors.  Proposals 2 and 3 are non-binding advisory votes regarding executive compensation, although the Compensation Committee of the Company’s Board of Directors will take into account the outcome of the vote when considering future executive compensation arrangements.  Proposal 2 (advisory vote on executive compensation) requires for adoption the affirmative vote of the holders of a majority of shares of Common Stock present in person or represented by proxy and entitled to vote on the proposal at the Annual Meeting.  With respect to Proposal 3 (advisory vote on frequency of say-on-pay vote), the option of “once every year,” “once every two years” or “once every three years” that receives the highest number of votes cast will be considered the frequency that has been approved by the stockholders on an advisory basis.  The ratification of the appointment of the Company’s independent registered public accounting firm (Proposal 4) requires for adoption the affirmative vote of the holders of a majority of shares of Common Stock present in person or represented by proxy and entitled to vote on the proposal at the Annual Meeting.

Abstentions, votes withheld and, unless a broker’s authority to vote on a particular matter is limited, shares held in street name that are not voted, are counted in determining the votes present at a meeting and entitled to vote, such as for quorum purposes.  Abstentions will be counted as present for purposes of determining the existence of a quorum but will be counted as not voting on any proposal brought before the Annual Meeting.  Since the election of directors (Proposal 1) is determined by a plurality of the votes cast at the Annual Meeting, abstentions will not affect the outcome of this matter.  An abstention as to the advisory vote on executive compensation (Proposal 2) and as to the ratification of the appointment of the independent registered public accounting firm (Proposal 4) will have the same effect as voting against the proposal.  Abstentions will not affect the outcome of the advisory vote on the frequency of the say-on-pay vote (Proposal 3).

 

 

 

 

 

 

 

 

 

 

Terry C. Anderson has served as a director of the Company since April 1998.  Mr. Anderson serves as the President and Chief Executive Officer of American Promotional Events, Inc., an importer and wholesaler of pyrotechnics, a position he has held since July 1988.  Mr. Anderson is the brother of Clyde B. Anderson, the Chairman, President and Chief Executive Officer of the Company.  Mr. Anderson is not an independent director.

 

 

 

 

Albert C. Johnson has served as a director of the Company since August 2005.  Mr. Johnson is an independent financial consultant and a retired CPA.  He retired from Arthur Andersen LLP in 1994 after a 30-year career.  Mr. Johnson most recently served as Senior Vice President and Chief Financial Officer of Dunn Investment Company from 1994 to 1998.  Mr. Johnson has served as a director of Hibbett Sports, Inc., a sporting goods retailer, since March 2008.  He also served as a director of Regions Morgan Keegan Mutual Funds from 2005 through 2009.  Mr. Johnson has been determined to be independent by the Board as defined by the listing standards of The NASDAQ Stock Market, Inc. (“NASDAQ”).

 

 

 

 

 

Clyde B. Anderson has served as the Chairman and Chief Executive Officer of the Company since March 2009.  Mr. Anderson was re-elected to the position of Chief Executive Officer upon the resignation of Sandra B. Cochran from that position in March 2009.  On August 20, 2009, Mr. Anderson was also re-elected to the position of President.  He served as the Executive Chairman of the Board of Directors from February 2004 to March 2009.  He has served as a director of the Company since August 1987.  Mr. Anderson has served as the Chairman of the Board of Directors since January 2000 and also served as the Chief Executive Officer of the Company from July 1992 until February 2004.  Mr. Anderson also served as the President of the Company from November 1987 to August 1999.  From November 1987 to March 1994, Mr. Anderson served as the Company’s Chief Operating Officer.  Mr. Anderson served on the Board of Directors of Hibbett Sports, Inc., a sporting goods retailer, from 1987 to June 2008.  Mr. Anderson is the brother of Terry C. Anderson, a member of the Company’s Board of Directors.  Mr. Anderson is not an independent director.

 

 

 

Ronald G. Bruno has served as the President of Bruno Capital Management Corporation, an investment company, since September 1995 and has served as a director of the Company since September 1992.  Formerly, Mr. Bruno served as the Chairman and Chief Executive Officer of Bruno’s Supermarkets, Inc., a supermarket retailing chain.  He also served on the Board of Directors for Russell Corporation from 1992 to 2006.  Mr. Bruno has been determined to be independent by the Board as defined by the listing standards of NASDAQ.

The Company believes that Mr. Bruno’s qualifications to serve on its Board include Mr. Bruno’s experience from his prior service as the Chairman and Chief Executive Officer of Bruno’s, Inc., a publicly traded retail grocery store, his prior service on the public company boards of directors of SouthTrust Bank, N.A. and Russell Corporation and his service on the Company’s Board since 1992.

 

 

 

Board Independence. NASDAQ listing standards require that the Company have a majority of independent directors.  The Board of Directors currently has six members, four of whom have been determined to be independent within the meaning of NASDAQ listing standards. Each year the Board makes a determination as to the independence of each Board member.  During its determination of the independence of directors, the Board of Directors specifically considered relationships between the Company and its affiliates and each director and his or her immediate family and affiliated entities.  The Board of Directors specifically considered the commercial lending/banking and 401(k) Plan relationship of SunTrust Banks, Inc. (“SunTrust”), of which Mr. Rogers serves as President and Chief Operating Officer, and the Company.  Total payments from the Company to SunTrust under these arrangements on a combined basis have been less than 1% of annual revenues of SunTrust in each of the past three annual periods.  The Board also specifically considered the lease payments under a real estate sublease made by Hibbett Sports, Inc. (“Hibbett”), of which Mr. Johnson serves as a director, to the Company.  Total payments to the Company from Hibbett under the lease have been less than 1% of annual revenues of the Company in each of the past three annual periods.  Based on this review, the Board concluded that these relationships do not interfere with Mr. Rogers’ or Mr. Johnson’s independent judgment in carrying out the responsibilities of a director.

 

Board Leadership Structure.  From 2004 to 2009, the Company had separate individuals serving as Chairman of the Board and as Chief Executive Officer.  During this period, Mr. Clyde Anderson, who served as Chief Executive Officer of the Company from 1992 through 2004, continued in an active leadership role of the Company serving as its Executive Chairman.  Upon the resignation of Sandra B. Cochran as President and Chief Executive Officer of the Company in March 2009, the Board of Directors reappointed Mr. Anderson to the role of Chief Executive Officer, believing that his more than 27 years of service to the Company, vast industry experience and close relationship with the Company’s management team uniquely qualified him for the role.  The Board believes that combining the roles of Chairman and Chief Executive Officer at this time is in the best interests of the Company and will best allow the Company to navigate through the current challenging economic environment, as well as future challenges of the Company’s business.

 

 

 

 

 

The Compensation Committee consists of Messrs. William H. Rogers, Jr., Chairman of the Committee, J. Barry Mason and Ronald G. Bruno. The responsibilities of the Compensation Committee include, in addition to such other duties as the Board may specify, establishing salaries, bonuses and other compensation for the Company’s executive officers and administering the Employee Stock Purchase Plan, the 2005 Incentive Award Plan, the Executive Deferred Compensation Plan and the Director’s Deferred Compensation Plan. The Compensation Committee held two meetings in fiscal 2011.  The Board of Directors has determined that the members of the Compensation Committee are independent directors, as defined by NASDAQ listing standards.  The Compensation Committee acts under a written charter adopted in 2007 and last reviewed and approved on March 22, 2011. The Compensation Committee charter is available free of charge on the Company’s website at www.booksamillioninc.com.

 

The Nominating and Corporate Governance Committee consists of Messrs. Ronald G. Bruno, Chairman of the Committee, J. Barry Mason and William H. Rogers, Jr. The responsibilities of the Nominating and Corporate Governance Committee include, in addition to such other duties as the Board may specify, developing and reviewing background information for candidates for the Board of Directors, and making recommendations to the Board regarding such candidates. The Nominating and Corporate Governance Committee also has the responsibility to review the corporate governance of the Company and recommend changes to the Board, and to review and evaluate the performance of each director on the Company’s Board of Directors. The Nominating and Corporate Governance Committee held two meetings in fiscal 2011.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REPORTING PERSON	NUMBER OF SHARES BENEFICIALLY OWNED	PERCENTAGE OF OUTSTANDING SHARES	REGISTERED SHARES(1)	PERCENTAGE OF OUTSTANDING SHARES
Dimensional Fund Advisors LP(2)	965,754	6.1%	965,754	6.1%
Anderson BAMM Holdings, LLC(3)	8,408,627(4)	53.4%	1,513,302(5)	9.6%
Charles C. Anderson(6)	8,408,627(4)	53.4%	2,164,076(7)	13.7%
Hilda B. Anderson(8)	8,408,627(4)	53.4%	14,111	*
Joel R. Anderson(9)	8,408,627(4)	53.4%	1,614,874(10)	10.3%
Charles C. Anderson, Jr.(11)	8,408,627(4)	53.4%	273,284	1.7%
Charles C. Anderson, III(12)	8,408,627(4)	53.4%	23,794	*
Terrence C. Anderson(13)	8,408,627(4)	53.4%	379,741(14)	2.4%
Clyde B. Anderson	8,408,627(4)	53.4%	1,800,685(15)	11.4%
Harold M. Anderson(16)	8,408,627(4)	53.4%	377,197	2.4%
Kayrita M. Anderson(17)	8,408,627(4)	53.4%	20,611	*
Hayley Anderson Milam(18)	8,408,627(4)	53.4%	25,380	*
Ashley Anderson Billingsley(19)(20)	8,408,627(4)	53.4%	84,000	*
The Ashley Anderson Trust(20)(21)	8,408,627(4)	53.4%	84,000	*
Irrevocable Trust of Charles C. Anderson, Jr. FBO Lauren Artis Anderson(22)	8,408,627(4)	53.4%	25,380	*
Olivia Barbour Anderson 1995 Trust(23)	8,408,627(4)	53.4%	1,200	*
Alexandra Ruth Anderson Irrevocable Trust(24)	8,408,627(4)	53.4%	1,200	*
First Anderson Grandchildren’s Trust FBO Charles C. Anderson, III(25)	8,408,627(4)	53.4%	11,224	*
First Anderson Grandchildren’s Trust FBO Hayley E. Anderson(25)	8,408,627(4)	53.4%	11,224	*
First Anderson Grandchildren’s Trust FBO Lauren A. Anderson(25)	8,408,627(4)	53.4%	11,224	*
Second Anderson Grandchildren’s Trust FBO Alexandra R. Anderson(25)	8,408,627(4)	53.4%	11,224	*
Third Anderson Grandchildren’s Trust FBO Taylor C. Anderson(25)	8,408,627(4)	53.4%	11,224	*
Fourth Anderson Grandchildren’s Trust FBO Carson C. Anderson(25)	8,408,627(4)	53.4%	11,224	*
Fifth Anderson Grandchildren’s Trust FBO Harold M. Anderson(25)	8,408,627(4)	53.4%	11,224	*
Sixth Anderson Grandchildren’s Trust FBO Bentley B. Anderson(25)	8,408,627(4)	53.4%	11,224	*
The Charles C. Anderson Family Foundation(26)	8,408,627(4)	53.4%	83,000	*
The Joel R. Anderson Family Foundation(26)	8,408,627(4)	53.4%	83,000	*
The Clyde B. Anderson Family Foundation(26)	8,408,627(4)	53.4%	46,000	*
Terrance G. Finley	157,400(27)	1.0%	157,400(27)	1.0%
Ronald G. Bruno	85,500(28)	*	85,500(28)	*
Douglas G. Markham	180,502(29)	1.1%	180,502(29)	1.1%
William H. Rogers, Jr.	44,090(30)	*	44,090(30)	*
J. Barry Mason	32,500(31)	*	32,500(31)	*
Albert C. Johnson	20,833(32)	*	20,833(32)	*
Brian W. White	55,242(33)	*	55,242(33)	*
All current directors and executive officers as a group (9 persons)(34)	8,984,694	57.1%	2,756,493	17.5%

(1)

“Registered Shares” includes only those shares as to which the reporting person claims beneficial ownership, as determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), notwithstanding the reporting person’s inclusion in the “group” described in footnote (4) below, if applicable.

 

(2)

The business address of Dimensional Fund Advisors LP (“Dimensional”) is Palisades West, Building One, 6300 Bee Cave Road, Austin, Texas 78746.  This information is based solely upon our review of a Schedule 13G filed by Dimensional with the Securities and Exchange Commission on February 11, 2011, reporting beneficial ownership as of December 31, 2010.  The Schedule 13G reports that Dimensional, in its role as an investment adviser registered under Section 203 of the Investment Advisors Act of 1940, furnishes investment advice to four investment companies registered under the Investment Company Act of 1940 and serves as investment manager to certain other commingled group trusts and separate accounts (collectively, “Funds”).  The Schedule 13G reports that, in certain cases, subsidiaries of Dimensional may act as an adviser or sub-adviser to certain Funds.  The Schedule 13G reports that, in its role as investment adviser, sub-adviser and/or manager, neither Dimensional nor its subsidiaries possess voting and/or investment power over the shares of the Company that are owned by the Funds but may be deemed to be the beneficial owner of the shares of the Company held by the Funds, even though all shares reported in the Schedule 13G are owned by the Funds.  Therefore, the Schedule 13G reports that Dimensional disclaims beneficial ownership of the shares.  Dimensional states that the filing of the Schedule 13G shall not be construed as an admission that it or any of its affiliates is the beneficial owner of any shares covered by the Schedule 13G for any other purposes than Section 13(d) of the Securities Exchange Act of 1934.

 

(3)

Anderson BAMM Holdings, LLC (“ABH”) is an investment company with its business address at 201 South Court Street, Suite 610, Florence, Alabama 35630.  ABH, a limited liability company organized under the laws of the State of Delaware, is managed by a Board of Directors, which Board is given full and complete authority, power and discretion to manage and control the business, affairs and properties of ABH and to make all decisions regarding those matters, which gives the Board the ultimate voting and investment control over the shares of the Company’s common stock contributed to ABH by its members.  The current Board of Directors of ABH consists of Charles C. Anderson, Joel R. Anderson, Charles C. Anderson, Jr., Terry C. Anderson and Clyde B. Anderson.  Harold M. Anderson has the right to nominate and elect himself to the Board at any time that he owns a membership interest in ABH.  Otherwise, the directors are elected by the members of ABH at its annual meeting.

 

(4)

8,408,627 shares may be deemed to be beneficially held as a “group” as such term is defined in Section 13(d)(3) of the Exchange Act.  Each of these persons and entities has filed a joint Schedule 13D with the Securities and Exchange Commission to acknowledge that they collectively may be deemed to constitute a “group” within the meaning of Section 13(d)(3) of the Exchange Act (the “13D Group”).  Members of the 13D Group, each of whom or which is designated by this footnote (4), do not have the power to vote or invest or dispose of, or the power to direct the vote or investment or disposition of, any Common Stock of the Company held by any other person or entity outside of the 13D Group, including, without limitation, any other person or entity who or which may be deemed to be a member of the 13D Group, unless otherwise indicated in the footnote description for the 13D Group member.  Accordingly, members of the 13D Group disclaim beneficial ownership of any securities of the Company held by any other person or entity, including, without limitation, any other person or entity who or which may be deemed to be a member of the 13D Group, and this Proxy Statement shall not be deemed an admission that the reporting person is the beneficial owner of such securities, unless otherwise indicated in the footnote description for the 13D Group member.  The 13D Group first filed a Schedule 13D on April 9, 2007, which Schedule 13D was amended by Amendment No. 1, Amendment No. 2, Amendment No. 3, Amendment No. 4, Amendment No. 5 and Amendment No. 6, filed with the Securities and Exchange Commission on April 20, 2007, February 19, 2008, September 5, 2008, March 9, 2009, March 23, 2010 and August 27, 2010, respectively.

 

(5)

Anderson BAMM Holdings, LLC issued membership interests to certain of the beneficial owners of the Company’s Common Stock in exchange for shares of Common Stock of the Company held by such persons, as specified in the Limited Liability Company Agreement of Anderson BAMM Holdings, LLC, attached as Exhibit 2 to the Schedule 13D filed by the 13D Group with the Securities and Exchange Commission on April 9, 2007, as amended by the First Amendment to the Limited Liability Company Agreement of Anderson BAMM Holdings, LLC, dated as of March 19, 2010, attached as Exhibit 4 to the Schedule 13D/A (Amendment No. 5) filed by the 13D Group with the Securities and Exchange Commission on March 23, 2010.

 

(6)	The business address of Mr. Charles C. Anderson is 202 North Court Street, Florence, Alabama 35630.  Charles C. Anderson served on the Company’s Board of Directors until June 3, 2004.

 

(7)	Includes 83,000 shares held by The Charles C. Anderson Family Foundation.  Charles C. Anderson is the Chairman of the Board of Directors of the foundation and has sole voting and dispositive power over these shares.

 

(8)	The business address of Mrs. Hilda B. Anderson is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.

 

(9)	The business address of Mr. Joel R. Anderson is 202 North Court Street, Florence, Alabama 35630.

 

(10)	Includes 83,000 shares held by The Joel R. Anderson Family Foundation.  Joel R. Anderson is the Chairman of the Board of Directors of the foundation and has sole voting and dispositive power over these shares.

 

(11)	The business address of Mr. Charles C. Anderson, Jr. is 265 Brookview Town Centre Way, Suite 501, Knoxville, Tennessee 37919.

 

 

(12)	The business address of Mr. Charles C. Anderson, III is 5/F Lippon Leighton Tower, 103-109 Leighton Road, Causeway Bay, Hong Kong.

 

(13)	The business address of Mr. Terrence C. Anderson is 4511 Helton Drive, Florence, Alabama 35630.

 

(14)	Includes 5,835 shares of restricted stock, 834 shares of which vest within sixty (60) days of March 25, 2011.  Terrance C. Anderson currently has the power to vote all of the shares of restricted stock.

 

(15)

Includes 46,000 shares held by The Clyde B. Anderson Family Foundation.  Clyde B. Anderson is the Chairman of the Board of Directors of the foundation and has sole voting and dispositive power over these shares.  Includes 14,526 shares held through the Books-A-Million, Inc. 401(k) Profit Sharing Plan.  Also includes 246,840 shares of restricted stock, none of which vest within sixty (60) days of March 25, 2011.  Clyde B. Anderson currently has the power to vote all of the shares of restricted stock.

 

(16)	The business address of Mr. Harold M. Anderson is 3101 Clairmont Road, Suite C, Atlanta, Georgia 30329.

 

(17)	The business address of Mrs. Kayrita M. Anderson is 3101 Clairmont Road, Suite C, Atlanta, Georgia 30329.

 

(18)	The business address of Ms. Hayley Anderson Milam is 202 North Court Street, Florence, Alabama 35630.

 

(19)	The business address of Ms. Ashley Anderson Billingsley is 202 North Court Street, Florence, Alabama 35630.

 

(20)	The shares over which Ashley Anderson Billingsley has shared voting power and shared dispositive power are held of record by The Ashley Anderson Trust.

 

(21)

The trustee of The Ashley Anderson Trust is CitiCorp Trust South Dakota, and the co-trustee of such Trust Reporting Person is Ashley Anderson Billingsley. The business address of The Ashley Anderson Trust, and of Ashley Anderson Billingsley as co-trustee, is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.  The business address of CitiCorp Trust South Dakota is 1300 West 57th Street, Suite G100, Sioux Falls, South Dakota 57108.

 

(22)	The business address of the Irrevocable Trust of Charles C. Anderson, Jr. FBO Lauren Artis Anderson, and for Martin R. Abroms as trustee of such trust, is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.

 

(23)	The business address of the Olivia Barbour Anderson 1995 Trust, and for Lisa S. Anderson as trustee of such trust, is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.

 

(24)	The business address of the Alexandra Ruth Anderson Irrevocable Trust, and for Lisa S. Anderson as trustee of such trust, is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.

 

(25)

The trustee for the (i) First Anderson Grandchildren’s Trust FBO Charles C. Anderson III, (ii) First Anderson Grandchildren’s Trust FBO Hayley E. Anderson, (iii) First Anderson Grandchildren’s Trust FBO Lauren A. Anderson, (iv) Second Anderson Grandchildren’s Trust FBO Alexandra R. Anderson, (v) Third Anderson Grandchildren’s Trust FBO Taylor C. Anderson, (vi) Fourth Anderson Grandchildren’s Trust FBO Carson C. Anderson, (vii) Fifth Anderson Grandchildren’s Trust FBO Harold M. Anderson and (viii) Sixth Anderson Grandchildren’s Trust FBO Bentley B. Anderson, in each case, is SunTrust Bank Alabama.  The business address of each trust is c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.  The business address of SunTrust Bank Alabama is 201 South Court Street, Florence, Alabama 35630.

 

(26)

The business address of (i) The Charles C. Anderson Family Foundation, (ii) The Joel R. Anderson Family Foundation and (iii) The Clyde B. Anderson Family Foundation is, in each case, c/o Abroms & Associates, 201 South Court Street, Suite 610, Florence, Alabama 35630.  All three foundations are charitable foundations formed under the laws of the State of Alabama.  Charles C. Anderson is the Chairman of The Charles C. Anderson Family Foundation’s Board of Directors and has the ultimate voting and investment control of the shares of the Company’s common stock held by the foundation.  Joel R. Anderson is the Chairman of The Joel R. Anderson Family Foundation’s Board of Directors and has the ultimate voting and investment control of the shares of the Company’s common stock held by the foundation. Clyde B. Anderson is the Chairman of The Clyde B. Anderson Family Foundation’s Board of Directors and has the ultimate voting and investment control of the shares of the Company’s common stock held by the foundation.

 

(27)	Includes 80,065 shares of restricted stock, none of which vest within sixty (60) days of March 25, 2011.  Mr. Finley currently has the power to vote all of the shares of restricted stock.  Also includes 1,156 shares held through the Books-A-Million, Inc. 401(k) Profit Sharing Plan.

 

(28)	Includes 5,835 shares of restricted stock, 834 shares of which vest within sixty (60) days of March 25, 2011.  Mr. Bruno currently has the power to vote all of the shares of restricted stock.

 

(29)

Includes 80,065 shares of restricted stock, none of which vest within sixty (60) days of March 25, 2011.  Mr. Markham currently has the power to vote all of the shares of restricted stock.  Also includes 10,000 shares held in an IRA account of Mr. Markham’s spouse and 1,468 shares held through the Books-A-Million, Inc. 401(k) Profit Sharing Plan.

 

(30)	Includes 12,000 shares subject to options that are currently exercisable.  Also includes 5,835 shares of restricted stock, 834 shares of which vest within sixty (60) days of March 25, 2011.  Mr. Rogers currently has the power to vote all of the shares of restricted stock.

 

(31)	Includes 5,835 shares of restricted stock, 834 shares of which vest within sixty (60) days of March 25, 2011.  Dr. Mason currently has the power to vote all of the shares of restricted stock.

 

(32)	Includes 5,835 shares of restricted stock, 834 shares of which vest within sixty (60) days of March 25, 2011.  Mr. Johnson currently has the power to vote all of the shares of restricted stock.

 

(33)	Includes 46,210 shares of restricted stock, none of which vest within sixty (60) days of March 25, 2011.  Mr. White currently has the power to vote all of the shares of restricted stock.

 

(34)	Includes 12,000 shares subject to options that are currently exercisable.  Also includes 482,355 shares of restricted stock, which the individuals included currently have the power to vote.

 

 

 

Pursuant to Securities and Exchange Commission rules for proxy statement disclosure of executive compensation, the Company has prepared the following Compensation Discussion and Analysis (“CD&A”). The CD&A addresses the objectives and implementation of the Company’s executive compensation programs and focuses on the policies and decisions behind the programs.  In addition, the Company intends that the CD&A clearly describe the current executive compensation program of the Company, including the underlying philosophy of the program and the specific performance criteria on which executive compensation is based.

 

 

·	Provide compensation levels that reflect the competitive marketplace so that the Company can attract, retain and motivate the most talented executives;

 

·	Provide compensation levels that are consistent with the Company’s business plan, financial objectives and operating performance;

 

·	Reward performance that facilitates the achievement of specific results and goals in furtherance of the Company’s business plan;

 

·	Motivate executives to make greater personal contributions to the performance of the Company helping it to achieve its strategic operating objectives; and

 

·	Provide proper motivation for enhancing stockholder value by providing long term incentive compensation, in the form of shares of restricted stock, in order to align the interests of executives with those of stockholders and the long term interest of the Company.

 

The compensation program is designed to reward officers for above average year-over-year Company and personal performance, the development of long term growth strategies, as well as longevity with the Company.

 

 

 

Gymboree Corporation	Hot Topic Inc.	Build-A-Bear Workshop Inc.
Conn’s Inc.	Shoe Carnival Inc.	Casual Male Retail Group Inc.
Big 5 Sporting Goods Corporation	Hibbett Sports Inc.	Einstein Noah Restaurant Group
Cato Corporation	A.C. Moore Arts & Crafts Inc.	Cache Inc.
Tuesday Morning Corporation	Christopher & Banks Corporation	Rex Stores Corporation
Buckle Inc.	Lumber Liquidators Inc.

 

Name	Bonus Attributable to Pre-Tax Income	Bonus Attributable to Personal Goals(1)	Discretionary Bonus	Total Cash  Bonus
Clyde B. Anderson	$222,349	$47,700(2)	$26,400	$296,449
Terrance G. Finley	95,930	36,306(3)	11,390	143,626
Douglas G. Markham	90,203	12,049(4)	10,710	112,962
Brian W. White	53,060	8,269(5)	6,300	67,629

(1)

The goals established by the Compensation Committee for fiscal 2011 included: (a) achievement of shareholder return with an end-of-year share price of $7.50 to $8.50 – goal was not achieved, (b) open eleven new stores and achieve budgeted run rate – goal was partially achieved, (c) achieve comparable same store sales comparison on par with chief competitors – goal was achieved, (d) achieve modified cash flow target of $20,575,000 – goal was not achieved (e) develop new lines of business with annualized sales of $3,000,000 – goal was achieved, (f) manage inventory levels with a target of $206,500,000 – goal was achieved and exceeded, (g) achieve EBITDA plan for Yogurt Mountain of $387,575 – goal was not achieved, (h) open at least one used book store and achieve 80% of budgeted profitability – goal was not achieved, (i) achieve retail inventory shrinkage level of between 1.7% and 1.9% – goal was achieved, (j) achieve financial system enhancements including retail stock ledger and documentation management – goal was achieved, (k) maintain quarterly accounts payable leverage ratio of between 45.8% and 51.5% – goal was not achieved.

(2)	Mr. Anderson’s personal goal categories consisted of opening new stores at budgeted run rate, same store sales comparison with competitor retailers, shareholder return goals, modified cash flow goals and development of new lines of business: ($47,700 bonus level achieved).

(3)

Mr. Finley’s personal goal categories consisted of opening new stores at budgeted run rate, same store sales comparison with competitor retailers, shareholder return goals, modified cash flow goals, development of new lines of business, achievement of EBITDA budget for Yogurt Mountain and opening of used book store at budget: ($36,306 bonus level achieved).

(4)

Mr. Markham’s personal goal categories consisted of: reduction of retail inventory shrinkage, shareholder return goals, opening of used book store at budget, modified cash flow goals, development of new lines of business and achievement of EBITDA budget for Yogurt Mountain: ($12,049 bonus level achieved).

(5)

Mr. White’s personal goal categories consisted of: reduction of retail inventory shrinkage, opening of used book store at budget, shareholder return goals, modified cash flow goals, financial system enhancements and maintenance of quarterly accounts payable leverage ratio: ($8,269 bonus level achieved).

 

 

Name	Career Based Shares	Performance Based Shares(1)
Clyde B. Anderson	100,000	100,000
Terrance G. Finley	18,750	18,750
Douglas G. Markham	18,750	18,750
Brian W. White	12,500	12,500

 

(1)

The actual number of Performance Based Shares to be paid out is on a sliding scale based on the Company’s pre-tax earnings in fiscal 2012.  The Company must attain a specified pre-tax earnings target in fiscal 2012 for the executive officers to earn the maximum amount of Performance Based Shares reflected in this column.

 

 

Elements of Compensation. During fiscal 2011, the Company’s executive officers earned compensation comprised of base salary, cash bonus and restricted stock, each as described above.

Mix of Compensation. The Company believes that maintaining a sound leadership team is fundamental to the Company’s success, and having the correct mix of compensation elements furthers this important objective.  A combination of base salary plus performance based bonuses allows for stability and growth both personally and professionally and provides motivation and incentive during the near term.  Restricted stock further encourages actual ownership of part of the Company and is a powerful motivating tool in aligning employees’ objectives with the Company’s objectives.  Equity ownership in general, and restricted stock in particular, also makes employees more focused on meeting long term goals and increasing overall stockholder value, as well as encouraging highly valued employees to remain with the Company.

Distribution between long term and currently paid out compensation. Having a balance between short and long term compensation is a fundamental part of the Company’s compensation package.  Base salaries and cash bonuses provide for the immediate necessity of attracting and retaining a well qualified staff, with the bonus component rewarding high levels of performance by both the Company and the individual.

Allocating between cash and non-cash compensation, and among different forms of non-cash compensation.  The Company believes that a fair balance between cash and non-cash compensation has been established.  The Compensation Committee continues to monitor the compensation programs with the assistance of input from outside advisors in order to ensure compliance with the changing landscape of executive pay.  Generally, as an executive’s level of responsibilities increases, a greater percentage of his or her compensation is tied to Company performance and a greater percentage is therefore subject to the risk tied to the return to the Company’s stockholders.

Award Determination.  Base salary, cash bonuses and restricted stock awards are determined once per year, typically in March.  Once the Company’s financial statements have been audited by an independent audit firm, the Compensation Committee will determine base salaries, bonuses and awards of restricted stock, as well as the measurement goals for achieving the various awards.  The Compensation Committee will also determine what portion of the performance based restricted stock awards which were authorized the previous year have been earned and approve the issuance of those shares of restricted stock as they have been earned.

Compensation Policies and Corporate Performance.  Compensation policies are primarily driven by the desire and intent to link the fundamental characteristics of the retail sector to various objectives related to making the Company successful.  By taking specific positive traits of successful retail companies into account when reviewing compensation, the Compensation Committee keeps the Company continuously striving for continued success.  These goals might include achieving certain earnings per share increases, new store growth, return on assets, return on equity and Sarbanes-Oxley compliance.

 

 

The Company’s Performance and the Executive’s Individual Performance. Base salary is paid regardless of the individual’s or the Company’s performance.  However, for employment to be maintained, the executive is expected to maintain certain levels of responsibility, time commitments and performance levels.  In addition, executives are unlikely to receive an increase in base salary if they have not demonstrated a commitment to individual and Company performance.  Cash bonuses reward individual and Company performance.  However, if the Company does not achieve certain minimum performance levels, no bonus will be awarded.  For fiscal 2011, executive officers were eligible to receive an annual cash bonus of between 75% and 150% of his or her base salary at the time of the award.  Restricted stock to some extent emulates the spirit of the cash bonus program.  The “Performance Based Shares” measurements are the same as the Company performance measurements maintained in connection with the cash bonus program. These shares have a two-year vesting period once the shares are earned and issued.  The “Career Based Shares” have a three-year cliff vest, and therefore require that the grantee remain an employee with the Company for a set period of time before they are earned.  The goals under the performance based bonus plan and performance based restricted stock grants (each established under the 2005 Incentive Award Plan) must be met before the awards are paid or awarded.  The Compensation Committee does have authority, however, to make non-performance based awards in its discretion.  The Compensation Committee has selected pre-tax income as the performance criteria for bonuses and performance based restricted stock awards because the criteria tracks the performance of the Company on an annual basis.

Material Changes to Compensation. Material changes in compensation are based on performance (both personal and Company performance), responsibility and time commitment.

Stock Ownership Requirements.  Executive officers are required to maintain a certain level of ownership of Company stock as determined by the Compensation Committee.

The Role of Executive Officers in the Compensation Process.  Executive officers participate in the compensation process to the extent of developing and presenting ideas and concepts to the Compensation Committee, with the assistance of the independent compensation consultant.  The independent compensation consultant prepared a report for the Compensation Committee with input from the executive officers.  The Compensation Committee has the final authority to determine all components of compensation structure.  The Chief Executive Officer does not have any role in determining his own compensation. Clyde B. Anderson, in his position as Chairman of the Board, President and Chief Executive Officer, provided input to the Compensation Committee as to the fiscal 2011 compensation for the Company’s other officers.  During fiscal 2011, Mr. Anderson provided the Compensation Committee with verbal personal performance evaluations of the other executive officers of the Company and proposed compensation adjustments, including salary increases and incentive compensation opportunities, for such officers to the Compensation Committee for its consideration.  Mr. Anderson provided the Compensation Committee with such verbal personal performance evaluations and compensation proposals at the March 2011 meeting of the Compensation Committee.  The Compensation Committee is ultimately responsible, however, for determining the compensation of these other executive officers.

The Compensation Committee, which consists of Messrs. William H. Rogers, Jr. (who served as Chairman throughout fiscal 2011), J. Barry Mason and Ronald G. Bruno, was responsible for establishing salaries, bonuses and other compensation for the Company’s executive officers for fiscal 2011, as well as for administering the Company’s 2005 Incentive Award Plan and Employee Stock Purchase Plan. Each member of the Compensation Committee is a non-employee director and is independent under NASDAQ listing standards.

The Compensation Committee continues to monitor the compensation programs with periodic assistance of input from outside advisors in order to ensure compliance with the changing landscape of executive pay.  The Compensation Committee held two meetings during fiscal 2011.  The Compensation Committee has reviewed and discussed the Company’s CD&A with management; and based upon this review and discussion, the Compensation Committee recommended to the Board that the CD&A be included in this Proxy Statement.

By the Compensation Committee of the Board of Directors:

 

Procedures for Approval of Related Person Transactions. The Audit Committee pre-approves all related person transactions and approves any changes to existing contracts as well as approving new contracts.  At the end of each year, the Audit Committee reviews all related person transactions and determines if the Company is compliant with current contracts.  This formal process approves and monitors all transactions with individuals and companies that could be considered related.  Related persons are defined by the Securities and Exchange Commission in Regulation S-K and are further explained in the Company’s Code of Business Conduct and Ethics and in the following paragraph.  The Audit Committee, pursuant to its written charter, must review and approve any and all related person transactions that exceed or are expected to exceed the $120,000 threshold requiring disclosure under the rules of the Securities and Exchange Commission.  The Audit Committee relies on information provided by its officers and directors in their annual questionnaires, as well as financial information reporting from the Company’s internal accounting department, to identify related person transactions that require consideration.  Further, the Company’s Code of Business Conduct and Ethics sets forth certain factors that must be considered in identifying potential conflicts of interest, including outside employment, improper personal benefits, financial interests, loans or other financial transactions, service on boards and committees and actions of family members, and requires that associates disclose to the Company any situations that reasonably would be expected to give rise to a conflict of interest.  In addition to these review procedures, the Audit Committee considers all other relevant factors when determining whether to approve a related person transaction, including whether the related person transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related person’s interest in the transaction.  No director may participate in any discussion or approval of any related person transaction in which he or she is a related person, but that director must provide the Audit Committee with all material information concerning the transaction.

 

In accordance with the Company’s Code of Business Conduct and Ethics, conflicts of interest are defined by outside employment, improper personal benefits, financial interests, loans or other financial transactions, service on outside Boards and Committees and actions of family members.  The Audit Committee has the authority to make waivers of conflicts of interest.

 

 

 

 

 

This section of the Proxy Statement discloses the compensation awarded, paid to or earned by each individual who served as an executive officer of the Company during fiscal 2011, including the Company’s principal executive officer and principal financial officer.

Based on the compensation reflected in the table below, “Salary” accounted for the following percentages of each named executive officer’s total compensation: 29.5% for Mr. Anderson, 45.4% for Mr. Finley, 45.6% for Mr. Markham and 47.1% for Mr. White.

Name and Principal Position	Fiscal Year	Salary ($)	Bonus ($) (3)	Stock Awards ($) (5)	Option Awards ($) (6)	Non-Equity Incentive Plan Compensation ($) (7)	All Other Compensation ($)	Total ($)
Clyde B. Anderson Chairman, President and Chief Executive Officer (Principal Executive Officer)	2011 2010 2009	439,712 423,385 341,000	26,400 19,125 -	654,300 165,000 429,959	- - -	270,049  386,925  11,000	100,894(8) 62,172 70,088	1,491,355 1,056,607 852,047
Terrance G. Finley Executive Vice President/Chief Merchandising Officer and President of Merchandising Group	2011 2010 2009	334,904 321,461 315,000	11,390 12,623 -	254,450 66,000 270,351	- - -	132,236  246,117  7,097	5,081(9)  10,533  10,753	738,061 656,734 603,201
Douglas G. Markham Executive Vice President/Chief Administrative  Officer and Secretary (1)	2011 2010 2009	311,266 215,179 237,799	10,710 10,125 -	254,450 66,000 270,351	- - -	102,252  189,420  17,813	4,548(10) 9,659 9,659	683,226 490,383 535,622
Brian W. White Chief Financial Officer (Principal Financial Officer) (2)	2011 2010 2009	209,808 188,615 151,346	6,300  6,750 30,000(4)	163,575 41,250 25,815	- - -	61,329  118,335  10,828	4,382(11) 3,710 266	445,394 358,660 218,255

 

(1)

Mr. Markham joined the Company in 2006 as the Company’s Chief Financial Officer.  Mr. Markham was recalled to active duty by the Navy Reserve from January 4, 2009 to July 12, 2009.  From July 12, 2009 until August 20, 2009, he again served as the Chief Financial Officer and Secretary of the Company.  On August 20, 2009, Mr. Markham was promoted to Executive Vice President/Chief Administrative Officer and Secretary of the Company.

 

(2)	During Mr. Markham’s deployment overseas from January 4, 2009 to July 12, 2009, Mr. White served as Interim Chief Financial Officer and Secretary of the Company.  Mr. White has served as the Company’s Chief Financial Officer since August 20, 2009.

 

(3)

The fiscal year 2011 amounts included in this column represent the discretionary bonuses awarded to these executive officers by the Compensation Committee relating to fiscal 2011 performance.  See “Compensation Discussion and Analysis – Elements of Compensation” for a discussion of the Company’s bonus plan.

 

(4)	The fiscal 2009 bonus amount for Mr. White was paid in conjunction with sign on and relocation.

 

(5)

The amounts included in the “Stock Awards” column represent the aggregate grant date fair value of non-option stock awards (i.e., career based and performance based restricted stock) that were issued in fiscal 2011, 2010 and 2009 in accordance with FASB ASC Topic 718.  The valuation assumptions used in determining such amounts are described in Note 6 to our consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended January 29, 2011.  Please see “Grants of Plan-Based Awards in Fiscal 2011” on  page 26 for more information regarding stock awards that were issued in fiscal 2011. If the highest level of performance conditions are achieved, then the grant date fair value of performance based stock awards for each officer is as follows: Mr. Anderson: $363,500, $66,000 and $146,550 for fiscal year 2011, 2010 and 2009, respectively; Mr. Finley: $145,400, $44,550 and $97,700 for fiscal year 2011, 2010 and 2009, respectively; Mr. Markham: $145,400, $44,550 and $97,700 for fiscal year 2011, 2010 and 2009,  respectively; Mr. White: $90,875, $3,300 and $7,328 for fiscal year 2011, 2010 and 2009, respectively.

 

(6)	There were no options granted in fiscal 2011, 2010 or 2009.

 

(7)

Non-Equity Incentive Plan Compensation is composed of a combination of performance based cash bonuses earned under the 2005 Incentive Award Plan and certain discretionary bonuses and are reported in the table with respect to the fiscal year in which they were earned.  See “Compensation Discussion and Analysis – Elements of Compensation” for a discussion of the Company’s bonus plan.

 

 

 

(8)

All Other Compensation for fiscal 2011 includes (i) matching contributions by the Company to the Company’s 401(k) savings plan of $1,671 and amounts paid in lieu of 401(k) savings plan match of $2,478 due to limits mandated for highly compensated executives on behalf of Clyde B. Anderson, (ii) life insurance premiums of $1,744 on behalf of Clyde B. Anderson and (iii) transportation related benefits, which consist of personal use of Company owned and Company chartered aircraft for fiscal 2011.  The estimated aggregate incremental cost to the Company for fiscal 2011 for personal use of Company aircraft by Clyde B. Anderson was $95,000.  The estimated aggregate incremental cost to the Company includes the actual cost paid by the Company for chartered aircraft and an estimate of the incremental cost to the Company of personal use of the Company owned aircraft based on the average variable operating costs to the Company.  Variable operating costs include fuel, maintenance, weather-monitoring, on-board catering, landing/ramp fees and other miscellaneous variable costs.

 

(9)

All Other Compensation for fiscal 2011 includes (i) matching contributions by the Company to the Company’s 401(k) savings plan of $1,671 and amounts paid in lieu of 401(k) savings plan match of $417 due to limits mandated for highly compensated executives on behalf of Terrance G. Finley and (ii) life insurance premiums of $2,993 on behalf of Terrance G. Finley.

 

(10)

All Other Compensation for fiscal 2011 includes (i) matching contributions by the Company to the Company’s 401(k) savings plan of $1,671 and amounts paid in lieu of 401(k) savings plan match of $1,551 due to limits mandated for highly compensated executives on behalf of Douglas G. Markham and (ii) life insurance premiums of $1,325 on behalf of Douglas G. Markham.

 

(11)

All Other Compensation for fiscal 2011 includes (i) matching contributions by the Company to the Company’s 401(k) savings plan of $1,671 and amounts paid in lieu of 401(k) savings plan match of $2,411 due to limits mandated for highly compensated executives on behalf of Brian W. White and (ii) life insurance premiums of $300 on behalf of Brian W. White.

 

Name	Grant Date	Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1)			All Other Stock Awards: Number  of Shares of Stock or Units (#) (2)	Grant Date Fair Value of Stock Awards ($) (3)
		Threshold ($)	Target ($)	Maximum ($)
Clyde B. Anderson	March 11, 2010	300,300	490,050	660,000	90,000	654,300
Terrance G. Finley	March 11, 2010	129,561	175,121	284,750	35,000	254,450
Douglas G. Markham	March 11, 2010	121,826	164,666	267,750	35,000	254,450
Brian W. White	March 11, 2010	71,663	96,863	157,700	22,500	163,575

 

(1)

Cash bonuses paid under the 2005 Incentive Award Plan are paid pursuant to goals established at the beginning of a fiscal year in connection with the preparation of the Company’s annual operating budget for such year. Under this bonus program, an executive officer is eligible to receive a bonus upon the Company achieving certain pre-tax income goals and the executive officer accomplishing certain individual performance goals related to his or her job functions.

 

 

(2)

Represents the grant of “Career Based Shares” and the pay-out of “Performance Based Shares” of restricted stock on March 11, 2010.  Such shares vest and all applicable restrictions lapse on February 2, 2013, for the Career Based Shares, and on January 28, 2012 for the Performance Based Shares, provided in each case that the executive remains continuously employed in active service by the Company through such date.  The executives have all of the rights of a stockholder with respect to earned Career Based Shares and Performance Based Shares, including the right to vote the shares and to receive all dividends or other distributions paid or made with respect to the shares subject to the grant.  The table below sets forth the number of Career Based Shares of restricted stock granted and the number of Performance Based Shares of restricted stock paid out to each of the named executive officers on March 11, 2010:

 

Name	Career-Based Shares of Restricted Stock	Performance-Based Shares of Restricted Stock	Total
Clyde B. Anderson	40,000	50,000	90,000
Terrance G. Finley	15,000	20,000	35,000
Douglas G. Markham	15,000	20,000	35,000
Brian W. White	10,000	12,500	22,500

 

 

(3)	The amounts set forth in the “Grant Date Fair Value of Stock Awards” column represent the full grant date fair value of restricted stock to each executive officer in fiscal 2011 as determined in accordance with FASB ASC Topic 718.

 

The following table presents information regarding unvested restricted stock awards for each of the named executive officers under the Company’s 2005 Incentive Award Plan and 1995 Executive Incentive Plan as of the end of the 2011 fiscal year, including the number of shares of Common Stock and the market value of such shares as of January 29, 2011. The table reflects the values of such awards based on the closing sale price of a share of Common Stock reported on the NASDAQ Global Select Market on January 28, 2011 (the last trading day prior to the end of the Company’s fiscal year), which was $5.59.

	Stock Awards
Name	Number of Shares or Units of Stock That Have Not Vested (#) (1)	Market Value of Shares or Units of Stock That Have Not Vested ($)
Clyde B. Anderson	130,000	726,700
Terrance G. Finley	55,000	307,450
Douglas G. Markham	55,000	307,450
Brian W. White	29,500	164,905

_______________________

(1)

For Mr. Anderson, represents 25,000 Performance Based Shares and 105,000 Career Based Shares awarded under the 2005 Incentive Award Plan.  For Mr. Finley, represents 10,000 Performance Based Shares and 45,000 Career Based Shares awarded under the 2005 Incentive Award Plan.  For Mr. Markham, represents 10,000 Performance Based Shares and 45,000 Career Based Shares awarded under the 2005 Incentive Award Plan.  For Mr. White, represents 6,250 Performance Based Shares and 23,250 Career Based Shares awarded under the 2005 Incentive Award Plan.

The following table shows the amounts received upon exercise of options and the vesting of restricted stock during fiscal year 2011. The table reflects the values of stock awards based on the closing sale price of a share of Common Stock reported on the NASDAQ Global Select Market on January 28, 2011 (the last trading day prior to the vesting date), which was $5.59.

	Option Awards		Stock Awards
Name	Number of Shares Acquired on Exercise (#)	Value Realized on Exercise ($)	Number of Shares Acquired on Vesting (#)	Value Realized on Vesting ($)
Clyde B. Anderson	—	—	110,000	614,900
Terrance G. Finley	—	—	58,500	327,015
Douglas G. Markham	—	—	56,000	313,040
Brian W. White	—	—	12,250	68,478

Name of Executive Officer	Amount that Would Have Been Realized Due to the Acceleration of Vesting of Restricted Stock in the Event of a Change in Control of the Company
Clyde B. Anderson	$726,700
Terrance G. Finley	307,450
Douglas G. Markham	307,450
Brian W. White	164,905

 

 

•

a lump sum cash payment equal to the sum of (a) the amount of any incentive or bonus compensation earned that has not yet been paid and (b) any benefits or awards (including both the cash and stock components) that, pursuant to the terms of any plans, policies or programs, have been earned or become payable, but that have not yet been paid to the executive (but not including amounts that previously had been deferred at the executive’s request, which amounts will be paid in accordance with the terms of the plan, policy or program under which the executive deferred the compensation) (“Accrued Obligations”);

•

three months of the executive’s current annual base salary;

•

for up to 18 months, continued participation in and coverage under the Company’s health and dental plans, disability plans, life insurance plans and all other welfare benefit plans in which the executive or his dependents were participating immediately prior to the date of termination, with all cost of such benefit paid or waived by the Company (“Welfare Continuance Benefit”); and

•

any other benefits payable due to the executive’s death or disability pursuant to the terms of any plan, policy or arrangement of the Company.

•

Accrued Obligations;

•

a lump sum cash termination benefit payment in an amount equal to two times the sum of (a) the executive’s annual base salary in effect at the date of termination and (b) the average of the cash bonuses paid to the executive for the Company’s three most recently completed fiscal years (subject to the execution of a release of claims against the Company by the executive); and

•

Welfare Continuance Benefit.

•

the executive’s earned base salary through the date of termination; and

•

the amount of any compensation previously deferred by the executive, which amount will be paid in accordance with the terms of the plan, policy or program under which the executive deferred the compensation.

•

Accrued Obligations; and

•

any other benefits to which the executive may be entitled pursuant to the terms of any plan, program or arrangement of the Company.

 

 

 

Name	Cash Severance (1)	Accrued Obligations (2)	Welfare Continuance Benefit (3)	Total
Termination Because of Death or Disability
Clyde B. Anderson	$110,000	$390,585	$17,659	$408,243
Terrance G. Finley	83,750	178,927	6,068	184,994
Douglas G. Markham	78,750	148,263	17,218	165,480
Brian W. White	52,500	91,163	16,847	108,010
Termination Without Cause or For Good Reason
Clyde B. Anderson	$1,355,666	$390,585	$17,659	$1,763,909
Terrance G. Finley	942,975	178,927	6,068	1,127,970
Douglas G. Markham	850,213	148,263	17,218	1,015,694
Brian W. White	555,695	91,163	16,847	663,705

(1)

In the event of termination because of death or disability, represents payment of three months of the executive’s current annual base salary as of January 29, 2011.  In the event of termination without cause or for good reason, represents a payment equal to two times the sum of (a) the executive’s annual base salary in effect as of January 29, 2011 and (b) the average of the cash bonuses paid to the executive for the Company’s three most recently completed fiscal years prior to January 29, 2011.

(2)

Accrued Obligations are the sum of the amount, if any, of any incentive or bonus compensation theretofore earned that has not yet been paid; and any benefits or awards (including both the cash and stock components) that, pursuant to the terms of any plans, policies or programs, have been earned or become payable, but that have not yet been paid.  For FY 2011, the amount contains the unpaid bonus and earned performance based shares of restricted stock that have not been paid out.

(3)	Includes all health and dental plans, disability plans and life insurance plans.

 
 

Name	Fees Earned or Paid in Cash ($)	Stock Awards ($) (1)	Total ($)
Terrance Anderson	32,000	18,175	50,175
Ronald Bruno	36,000	18,175	54,175
Albert C. Johnson	49,500	18,175	67,675
J. Barry Mason	46,000	18,175	64,175
William Rogers	47,500	18,175	65,675

________________________

(1)

Represents annual award of 2,500 shares of restricted stock for each director granted on March 11, 2010.  As of March 25, 2011, 2,500 shares of the Company’s common stock had a value of $10,250, based on the closing sale price of the Company’s Common Stock on the NASDAQ Global Select Market on March 25, 2011 of $4.10 per share.

 

 

 

 

 

Vote Required; Board Recommendation.  The affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy and entitled to vote at the Annual Meeting is required to approve this proposal.  Unless instructed to the contrary, the shares represented by the proxies will be voted to approve the resolution on the compensation of our named executive officers.

At the direction of the Audit Committee, the ratification of the appointment of Grant Thornton LLP as the Company’s independent registered public accounting firm (“independent auditor”) for the fiscal year ending January 28, 2012, is being presented to the stockholders for approval at the Annual Meeting.  Although stockholder ratification is not required by our by-laws or otherwise, the Board is submitting the selection of Grant Thornton LLP to our stockholders for ratification as a matter of good corporate practice.  If the appointment of Grant Thornton LLP as the independent auditor is not ratified, the Audit Committee will reconsider its appointment of the independent auditor.

General. The Audit Committee of the Board of Directors has selected Grant Thornton LLP to serve as the Company’s independent auditor for the Company’s 2012 fiscal year ending on January 28, 2012.  Grant Thornton LLP has been engaged by the Company since April 29, 2005, and has audited the financial statements of the Company for its 2011, 2010 and 2009 fiscal years. Representatives of Grant Thornton LLP are expected to be present at the annual meeting. They will be provided an opportunity to make a statement if they desire to do so and they will be available to respond to appropriate questions.

 

Auditor Fees and Services. The following table shows the fees paid or accrued, including out-of-pocket expenses, by the Company for the audit and other services provided by Grant Thornton LLP for fiscal years 2011 and 2010:

Fees	Fiscal 2011	Fiscal 2010
Audit fees (1)	$574,059	$547,074
Audit related fees (2)	38,200	103,350
Tax fees (3)	9,200	9,200
Total	$621,459	$659,624

 

(1) Audit fees represent fees for professional services provided in connection with the audit of the Company’s annual consolidated financial statements and internal control over financial reporting, review of quarterly consolidated financial statements, audit of employee benefit plans and audit services provided in connection with other statutory or regulatory filings.

 

(2) Audit related fees represent fees for professional services in connection with the audits of the Company’s employee benefit plans.

 

(3) Tax fees principally included tax compliance fees and tax advice and planning fees.

 

Pre-Approval Policies and Procedures; Non-Audit Services.  The Audit Committee pre-approves all audit-related and non-audit services not prohibited by law to be performed by the Company’s independent auditors.  The Audit Committee has considered whether the provision of non-audit services by the Company’s independent auditor is compatible with maintaining the independent auditor’s independence and believes that the provision of such services is compatible.

 

Vote Required; Board Recommendation.  The affirmative vote of the holders of a majority of the shares of Common Stock present in person or represented by proxy and entitled to vote at the Annual Meeting is required to ratify the appointment of Grant Thornton LLP as the independent auditor.  Unless instructed to the contrary, the shares represented by the proxies will be voted to approve the ratification of the appointment of Grant Thornton LLP as the independent auditor.

 

 

 

 

 

	Shareowner ServicesSM P.O. Box 64945 St. Paul, MN 55164-0945		COMPANY #
		Vote by Internet, Telephone or Mail 24 Hours a Day, 7 Days a Week Your phone or Internet vote authorizes the named proxies to vote your shares in the same manner as if you marked, signed and returned your proxy card.
		:		INTERNET – www.eproxy.com/bamm Use the Internet to vote your proxy until 12:00 p.m. (CT) on May 23, 2011.
		(		PHONE – 1-800-560-1965 Use a touch-tone telephone to vote your proxy until 12:00 p.m. (CT) on May 23, 2011.
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If you vote your proxy by Internet or by Telephone, you do NOT need to mail back your Proxy Card

 

 

 

1.	To elect the nominees listed to serve  as a director of the Company for a  three-year term expiring in 2014:	01	Terry C. Anderson	o	Vote FOR all nominees	o	Vote WITHHELD
		02	Albert C. Johnson		(except as marked)		from all nominees

(Instructions: To withhold authority to vote for any indicated nominee, write the number(s) of the nominee(s) in the box provided to the right.)
2.	To hold a non-binding advisory vote on the compensation of our named executive officers			o	For	o	Against	o	Abstain
3.	To hold a non-binding advisory vote on the frequency of future executive compensation advisory votes	o	Once Every Year	o	Once Every Two Years	o	Once Every Three Years	o	Abstain
4.	To ratify the appointment of Grant Thornton LLP as the independent registered public accounting firm			o	For	o	Against	o	Abstain
5.	In their discretion, upon such other matter or matters which may properly come before the meeting or any adjournment(s) thereof

Address Change? Mark box, sign, and indicate changes below: o

Date:

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Signature(s) in Box   NOTE: Please sign exactly as name appears hereon. If shares are registered in more than one name, the signatures of all such persons are required. A corporation should sign in its full corporate name by a duly authorized officer, stating his or her title. Trustees, guardians, executors and administrators should sign in their official capacity, giving their full title as each. If a partnership, please sign in the partnership name by an authorized person.

 

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